Spot gold was down 1.25 percent at $1,107.36 an ounce, while U.S. gold futures for December delivery settled down $19 at $1,102.
"The dollar's back up again today, which is underpinning the fall, and there is possibly somre pressure from the resurgent equity market," Mitsubishi analyst Jonathan Butler said.
"We have another week to go before the Fed, and I think a September rate hike has been all but ruled out. The situation is just too uncertain."
Global shares surged on Wednesday, led by the biggest daily gains in Japan for seven years, helping to lift the dollar and oil prices as the prospect of more stimulus from China soothed investors rattled by recent market turmoil.
Gold has failed to attract strong investor interest as a safe haven, despite the recent weakness in stocks because of worries over the Chinese economy, showing that the metal is struggling to find direction outside U.S. monetary policy, analysts say.
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"In the run-up to the Fed's meeting next week, market participants are likely to be exercising restraint, so we are unlikely to see any pronounced price fluctuations," Commerzbank said in a note.
The physical gold market has also been mixed, providing little support to global prices.
Gold prices in India are at a discount to the global benchmark for the first time since mid-July as a weak monsoon dampened demand in the world's second-biggest consumer.
In top consumer China, premiums edged higher on the Shanghai Gold Exchange to about $5 an ounce on Wednesday morning from last week's $4.